1985 (8) TMI 219 - AT - Central Excise

Summary

Issues:
Classification of plastic articles under Central Excise Tariff - Item 15A (2) vs. Item 68 - Impact of Finance Bill, 1982 - Effect of Notification No. 68/71 and subsequent amendments.

Analysis:
The judgment involves a dispute regarding the classification of plastic articles under the Central Excise Tariff, specifically whether they fall under Item 15A (2) or Item 68. The Collector of Central Excise, Pune, appealed against the Appellate Collector's decision to classify certain plastic parts like radio cabinets and knobs under Item 68 instead of Item 15A (2). The dispute arose due to changes introduced by the Finance Bill, 1982, and subsequent notifications affecting the duty levied on these plastic articles.

The key issue was whether the plastic articles should be classified under Item 15A (2) or Item 68 of the Central Excise Tariff during the period from 28-2-1982 to 19-4-1982. The appellant argued that despite changes in the Finance Bill, the rate of duty remained the same for the goods in question, so they should continue to be classified under Item 15A (2). On the other hand, the respondent contended that the immediate effect of the changes in the Finance Bill shifted the classification to Item 68, making the plastic articles dutiable under a different category.

The Tribunal analyzed the provisions of the Finance Bill, 1982, along with notifications issued under the Central Excise Rules, 1944, to determine the correct classification of the plastic articles. It was noted that while the Finance Bill introduced changes in the description of plastic articles, the rate of duty remained constant. The Tribunal held that the immediate effect declaration under the Provisional Collection of Taxes Act did not apply in this case as there was no imposition or increase in excise duty. Therefore, the plastic articles continued to be classified under Item 15A (2) until the enactment of the Finance Bill, 1982, which shifted them to Item 68.

Additionally, the Tribunal referenced a previous case, Collector of Central Excise v. M/s. Parmali Wallace Ltd., to distinguish the application of immediate effect declarations in cases of duty imposition or increase. The Tribunal emphasized that changes in tariff classification do not necessarily imply a fresh levy of duty, especially when the rate of duty remains unchanged. The judgment highlighted the distinction between the levy of duty on manufacture and the determination of applicable duty rates post-manufacture.

In conclusion, the Tribunal set aside the Collector (Appeals) order and allowed the appeal, affirming that the plastic articles were correctly classified under Item 15A (2) until the enactment of the Finance Bill, 1982. The judgment emphasized the legal principles governing the classification of goods under the Central Excise Tariff and the impact of legislative changes on duty imposition and rates.